City of Sandpoint v. Independent Highway District

This appeal concerns the legality of a Joint Powers Agreement (“JPA”) entered into in 2003 between the Independent Highway District (“IHD”) and the City of Sandpoint (“City”) in settlement of litigation. The JPA provides for the City to assume control of all streets in the City and for IHD to pay over to the City all highway ad valorem taxes collected on property in the city limits. After the parties had operated under the JPA for ten years, IHD notified the City that, upon reflection, it had determined the JPA was legally void and that it would no longer pay its share of the property taxes…